Correlation Between GRENKELEASING and LOANDEPOT INC

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Can any of the company-specific risk be diversified away by investing in both GRENKELEASING and LOANDEPOT INC at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining GRENKELEASING and LOANDEPOT INC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GRENKELEASING Dusseldorf and LOANDEPOT INC A, you can compare the effects of market volatilities on GRENKELEASING and LOANDEPOT INC and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in GRENKELEASING with a short position of LOANDEPOT INC. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRENKELEASING and LOANDEPOT INC.

Diversification Opportunities for GRENKELEASING and LOANDEPOT INC

-0.27
  Correlation Coefficient

Very good diversification

The 3 months correlation between GRENKELEASING and LOANDEPOT is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding GRENKELEASING Dusseldorf and LOANDEPOT INC A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LOANDEPOT INC A and GRENKELEASING is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on GRENKELEASING Dusseldorf are associated (or correlated) with LOANDEPOT INC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LOANDEPOT INC A has no effect on the direction of GRENKELEASING i.e., GRENKELEASING and LOANDEPOT INC go up and down completely randomly.

Pair Corralation between GRENKELEASING and LOANDEPOT INC

Assuming the 90 days trading horizon GRENKELEASING Dusseldorf is expected to under-perform the LOANDEPOT INC. But the stock apears to be less risky and, when comparing its historical volatility, GRENKELEASING Dusseldorf is 1.95 times less risky than LOANDEPOT INC. The stock trades about -0.03 of its potential returns per unit of risk. The LOANDEPOT INC A is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  174.00  in LOANDEPOT INC A on October 16, 2024 and sell it today you would lose (13.00) from holding LOANDEPOT INC A or give up 7.47% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

GRENKELEASING Dusseldorf  vs.  LOANDEPOT INC A

 Performance 
       Timeline  
GRENKELEASING Duss 

Risk-Adjusted Performance

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Over the last 90 days GRENKELEASING Dusseldorf has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's forward-looking indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.
LOANDEPOT INC A 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days LOANDEPOT INC A has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

GRENKELEASING and LOANDEPOT INC Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with GRENKELEASING and LOANDEPOT INC

The main advantage of trading using opposite GRENKELEASING and LOANDEPOT INC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GRENKELEASING position performs unexpectedly, LOANDEPOT INC can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in LOANDEPOT INC will offset losses from the drop in LOANDEPOT INC's long position.
The idea behind GRENKELEASING Dusseldorf and LOANDEPOT INC A pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.

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